The Draft UK EU Withdrawal Agreement published on 19 March 2018 contains no mention of the financial services industry whilst confirming that the transitional period will last from Brexit day on 29 March 2019 until 31 December 2020.
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The European Commission (“EC”) have published a proposed directive and a proposed regulation amending Directive 2011/61/EU on Alternative Investment Fund Managers (“AIFMs”) and Directive 2009/65/EC on undertakings for collective investment in transferable securities (“UCITS”) to facilitate cross-border marketing of funds, including pre-marketing under the AIFM Directive.
The date and time of the publication of the SONIA benchmark is changing on Monday 23 April 2018. Friday 20 April 2018 will be the final day for which SONIA will be calculated and published by the Wholesale Market Brokers’ Association (“WMBA”) using the current methodology.
Over the summer of 2018, the London offices of the Financial Conduct Authority (“FCA”) are relocating from 25 The North Colonnade, Canary Wharf, London E14 5HS and 1 Canada Square, Canary Wharf, London E14, to a new location in The International Quarter of Stratford: 12 Endeavour Square, London E20 1JN.
The Financial Conduct Authority (“FCA”), via a specific webpage entitled ‘Survey for EEA inbound passported firms’, are asking all firms they solely regulate that passport into the UK (either via a branch or on a cross-border services basis) or market funds in the UK to complete a short online survey.
The Financial Conduct Authority (“FCA”) has changed its main telephone number for consumers from 0845 606 1234 to 0800 111 6768. The number is for Consumers (and people representing consumers) to call the FCA on 0800 111 6768 (freephone) or 0300 500 8082 from the UK, or +44 207 066 1000 from abroad. This number is answered Monday to Friday, 8am to 6pm, and Saturday from 9am to 1pm.
The FCA and PRA have been reviewing firms’ algorithmic trading activity and have issued supervisory publications. For firms solo-regulated by the FCA, please refer to the FCA publication. Firms regulated by the PRA and FCA should refer to both publications. Firms operating in wholesale markets increasingly use algorithms for a number of purposes across their trading activity. In particular, driven by the rise in electronic trading platforms and the increased availability of data, algorithms are now often used for making both execution and investment decisions. It is essential that key oversight functions, including compliance and risk management, keep pace with technological advancements.
The Financial Conduct Authority (“FCA”) have stated that compliance with the EU General Data Protection Regulation (“GDPR”) is now a board level responsibility, and that firms must be able to produce evidence to demonstrate the steps that they have taken to comply.
Under SM&CR proposals, only Senior Managers will appear on the FS Register; CF10As for Core and Limited Scope firms, CF28s, CF29s, and CF30s would not appear. FCA will consult on maintaining a central public record of these important individuals in FCA-regulated firms.
The FCA is consulting in CP18/4 on the EU Money Market Funds (“MMF”) Regulation, which came into force on 21 July 2017 and applies to new MMFs from 21 July 2018 and to existing MMFs from 21 January 2019. The FCA and the Treasury have identified areas of the UK regulatory framework that require changes.
The UK will become a 'third country' on 30 March 2019, unless a ratified withdrawal agreement establishes another date. The EC have issued two Notices to Stakeholders reminding managers of investment funds and investors of the legal repercussions which need to be considered.
FCA plans for transitioning firms and individuals to the new regime.
Four months until implementation.
New requirements for trading on AIM.
Firms to review their arrangements as result of failings.
Views post implementation
The FSMA By Way of Business Order (SI 2001/1177) is to be amended, affecting P2P lenders and others that operate a loan-based crowdfunding platform which facilitates loans to lending businesses.
The London Stock Exchange ("LSE") requires all AIM companies with securities admitted to trading on AIM to have a Legal Entity Identifier (“LEI”) code. This is in order to ensure compliance with the obligations under Markets in Financial Instrument Directive (“MiFID II") and Market Abuse Regulation, which require market operators, such as London Stock Exchange, to collate LEI codes for each issuer with securities admitted to trading.
MiFID II will introduce a new designation of “SME Growth Market” that operators of qualifying markets can voluntarily apply for. London Stock Exchange, as operator of the largest market for small and medium sized growth companies in the EU, has applied to the FCA for AIM.
The FCA is proposing to automatically convert individuals from the Approved Persons Regime to the Senior Managers and Certification Regime; the majority of firms will not need to submit applications to convert Approved Persons to Senior Managers.